Defending Santa
Heckler & Frabizzio defends Santa in a malicious suit for trespassing. Amy Taylor, Partner, was successful in getting the case dropped. Santa was thrilled by the result and stated “In all of the centuries he has never worked with a better law firm.”
WORKERS’ COMPENSATION LAW
Employers/Carriers Beware – Possible Liability for Fines/Penalties Under the Workers’ Compensation Act in Delaware:
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First Report of Injury (FROI) – Within ten days after knowledge of the occurrence of an accident resulting in personal injury, a report thereof shall be made in writing by the Employer to the Department of Labor in duplicate, and a copy provided to the Employee. Whenever an Employer refuses or neglects to make a report required by this section, the Employer shall be fined not less than $100.00 nor more than $250.00 for each offense. In the event the Employer can show that the failure to make a report was caused by the refusal of the Insurance Carrier for the Employer to report a reportable injury which the Insurance Carrier had knowledge of and of which the Employer had no knowledge, after written request therefor, the aforementioned fine may be levied against said Insurance Carrier. In either event, any fine is payable to the Workers’ Compensation Fund. Note that while historically this penalty was not often requested by claimant attorneys before the Board, we are aware of recent filings and/or threatened filings made by claimant attorneys as well as attorneys on behalf of the Department of Labor.
Failure to Timely Advise of Denial of Claim – An Employer or its Insurance Carrier shall within 15 days after receipt of knowledge of a work-related injury, notify the Department of Labor and the claimant in writing of: the date the notice of the claimant’s alleged industrial accident was received; whether the claim is accepted or denied; if denied, the reason for the denial; or if it cannot accept or deny the claim, the reasons therefor and approximately when a determination will be made. 19 Del. C. § 2362(a).
If an Employer or its Insurance Carrier fails to comply with § 2362(a), they can be met with a fine no less than $500.00 and no more than $2,500.00. Note that there is no Delaware state form “denial letter”. We are happy to provide a recommended form, upon request.
Failure to Issue Timely Payment/Huffman Demand – Under Huffman v. C.C. Oliphant & Son, Inc., Del. Supr., 432 A.2d 1207 (Del. 1981), where an employer/carrier fails to issue timely payment of specific benefits owed, either pursuant to an Industrial Accident Board Award or Settlement Agreement between the parties, within 30 days of a written demand for payment, this can result in sanctions/penalties including a liquidated damage payment of 10% per day of the outstanding balance up to 100% liquidated damages, costs of any filing, and a claimant’s attorney’s fee. As a corollary, 19 Del. C. § 2362(d) states that following an Award by the Board, the first payment of compensation shall be paid by the Employer or its Insurance Carrier no later than 14 days after the award becomes final. Failure to comply with § 2362(d) can be met with a fine no less than $500.00 and no more than $2,500.00.
Penalties for Late Medical Payments – If a claimant submits a medical bill issued from a certified provider, the medical bill must be paid or denied within 30 days following a “clean claim.” If a Carrier fails to comply with the 30-day requirement, the invoice may be subject to an interest rate at 1% per month to the medical provider. Failure to pay may also subject the Carrier to a fine of up to $5,000.00 per occurrence. 19 Del. C. § 2322F. On a related note, 19 Del. C. § 2362(b) provides that all medical expenses shall be paid within 30 days after bills and documentation for said expenses are received by the Employer or its Insurance Carrier for payment, unless the Carrier or Self-Insured Employer notifies claimant or the claimant’s attorney in writing that said expenses are contested or that further verification is required. If the Employer or Carrier fails to comply with § 2362(b) they are subject to a potential fine no less than $500.00 and no more than $2,500.00. Independent Medical Examination – 19 Del. C. § 2320(7) provides that if any employee submits to a medical examination requested by the Employer or the Board, this examination shall not be referred to as an “Independent Medical Examination” or “IME” in any proceeding or on any document relating to a matter in the Delaware Workers’ Compensation arena. Use of this term can result in a fine of up to $500.00 for each offense. Employers/Carriers who handle work in multiple jurisdictions, in particular, should be aware of this rule.
Should you have any questions regarding the above, please contact any attorney in our Workers’ Compensation Department.
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EMPLOYMENT LAW
Employer’s ‘Lack of Notice’ Argument Fails to Persuade Court
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The employee worked as a security guard for the Employer for six years. Employee was terminated in 2019 for allegedly falsifying company records and engaging in threatening behavior. Employee filed for unemployment benefits and was initially disqualified from receiving such. Employee appealed the decision to the Appeals Referee, who found that the Employee was eligible to receive benefits. The Employer appealed the referee’s decision to the Board, who concluded that the employee was terminated for just cause and disqualified from benefits. The Employee filed an appeal to the Superior Court, which remanded the case back down to the Board who directed the Appeal’s Referee to conduct a fact-finding hearing.
The Employer failed to appear for the referee hearing and establish that the Employee was terminated for good cause. Therefore, the Appeal’s Referee found in his favor. After the deadline to appeal passed, Employer attempted to appeal the decision explaining that it never received notice of the hearing. However, the Board affirmed the Referee’s decision because the Employer’s appeal was untimely. The Employer appealed the decision to the Superior Court arguing that the Board violated the Employer’s due process rights when it denied Employer the ability to present evidence as well as the Board abused its discretion and committed legal error when it failed to address the Referee’s lack of consideration of the Superior Court’s remand instructions.
On appeal, the Court must determine whether the findings and conclusions of the Board are free from legal error and whether they are “supported by substantial evidence in the record.”
The Court found that the Board did not deny the Employer its due process rights because the Employer received a notice of the hearing. When notice is correctly addressed, stamped, and mailed, it is “presumed to have been received by the party to whom it was addressed.” Despite the argument by Employer’s counsel that they never received notice of the hearing, the Court found that there was evidence supporting the presumption that the Employer received notice based on other documents being mailed to and received by Employer. The Court further noted that there is no requirement that the notice of an agency hearing is sent to counsel for a party.
As for Employer’s second argument, that the Board failed to grant an appeal hearing, the Court found that the Employer’s last day to appeal the Referee’s decision was February 6, and Employer filed an appeal on February 23. The Board can accept untimely appeals in the event of “severe circumstances.” However, the Board found that the Employer had been given notice, had an opportunity to be heard, and found no evidence of any severe circumstances to justify the untimely appeal.
Lastly, the Court rejected Employer’s argument that the Referee failed to consider the Court’s remand instructions. The Court pointed to the Referee’s own statement who said, “I will also check the Superior Court decision.”
Based on the above, the Court affirmed the Board’s Decision and found that the Employee is entitled to benefits.
Acts Ret. Life Communities v. Igo,2021 WL 5411091 (Del. Super. Nov. 17, 2021)
Should you have any questions regarding this decision, or any liability law questions, please contact any attorney in our Liability Law Department.
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LITIGATION CASE LAW
Court Not Persuaded by General Contractor’s Attempt to Exclude Workers’ Compensation Benefits Paid to Plaintiff in Third-Party Claim
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Plaintiff was allegedly injured in an accident at a construction site. At the time of the accident, Plaintiff’s Employer failed to maintain workers’ compensation insurance coverage and the project’s General Contractor failed to confirm that a policy was in effect. As such, General Contractor was statutorily deemed to have insured Plaintiff’s workers’ compensation claim and thereafter its workers’ compensation Insurer paid medical and indemnity benefits.
Plaintiff commenced a third-party action against the various parties involved in the construction accident. Therein, General Contractor moved to prohibit Plaintiff from introducing as evidence the medical specials and indemnity payments made by Insurer— its workers’ compensation carrier. In support thereof, General Contractor argued that since it paid premiums for such coverage, any benefits arising thereunder were not from a collateral source of Plaintiff and therefore inadmissible at trial.
In deciding the dispute, the Delaware Superior Court reviewed Delaware’s collateral source rule which prevents a tortfeasor from reducing its damages because of payments or compensation received by the injured person from an independent source. The Court noted that Insurer was the real party in interest, and it maintained a statutory right to reimbursement from any recovery made by Plaintiff. The Court found no logical reason why General Contractor should receive the advantage of benefits that Plaintiff must reimburse, or otherwise impair Insurer’s rights.
Further, the insurance premium payments made by General Contractor were not for Plaintiff’s benefit. Instead, such payments were made to insure its own employees and simply extended to Plaintiff because General Contractor failed to confirm that its subcontractors had workers’ compensation insurance.
For more information on this matter or other legal questions, feel free to contact any attorney in our Liability Department.
DeSousa v. Station Builders, Inc., et al., 2021 WL 5754745 (Del. Super. Ct. Dec. 3, 2021).
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